Forms of use of non-financial measures: evidence from the manufacturing sector in Navarra (Spain)

• Published in: Revista española de financiación y contabilidad Vol. 37; no. 139; pp. 441 - 467
• Main Authors: León, Carmen Aranda, Gil, Javier Arellano, Aldecoa, Marisol Basabe
• Format: Journal Article
• Language: English
• Published: Routledge 2008
• Subjects: Cualidades de la información; Indicadores no financieros; Nonfinancial performance measures; Perceived usefulness of nonfinancial information; Performance measurement system; Qualities of the information; Sistemas de medida del desempeño
• ISSN: 0210-2412; 2332-0753
• DOI: 10.1080/02102412.2008.10779650

Management accounting Literature supports that the differential use of accounting based measures reflects different needs. However, literature on nonfinancial measures has practically focused on the importance/weight given to these measures in the firm performance measurement systems. We extend current knowledge by carrying this differential use of financial information over to nonfinancial information. Thus, in this paper, we argue that nonfinancial measures may also not be a monolithic category and, therefore, the phenomenon of an increase in their use could also be approached by posing the question of how nonfinancial information is used. From the analysis of thirty one cases of manufacturing firms we find that i) the perception of managers about the usefulness of nonfinancial information characteristics of relevance and reliability changes depending on the contextual scenarios the companies face, and ii) these perceptions result in the existence of two differential uses of nonfinancial measures.